Compliance January 3, 2003

Pension Reform Bills Slated for Mark up

March 13, 2002 (PLANSPONSOR.com) - Faced with a plethora of post-Enron pension reform proposals, lawmakers now look for common ground as legislation introduced by pension reform champions Representatives Rob Portman (R-Ohio) and Ben Cardin (D-Maryland), heads to the House Ways and Means Committee for mark up.
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The Employee Benefits Bill of Rights (H.R. 3369), which includes some of the elements of President Bush’s pension reform proposals and is slated for mark up today, would:

  • allow employees to diversify employer matches to Section 401(k) accounts made in company stock after three years participation in the plan
  • allow employers to diversify non-elective deferrals made in company stock after five years participation
  • require 21-days notice prior to an employee-lockout period
  • give employees a primer on basic financial principles on enrolment, and annually thereafter
  • give employees the option of paying for retirement advice and counseling using pretax dollars

Pension Security Act

On March 20, The House Education and the Workforce Committee will mark up the Pension Security Act (H.R. 3762), sponsored by Chairman John Boehner (R-Ohio) and Representative Sam Johnson (R-Texas) and based on President Bush’s proposal for pension reform. H.R. 3762 will be combined with the Ways and Means bill in the Rules Committee.

The Pension Security Act would:

  • allow employees to diversify all holdings after three years participation in the plan
  • require quarterly benefit statements
  • require 30 days notice before a lockout
  • prevent executives from selling company stock during a rank-and-file employee lockout.

Under this legislation, plan sponsors would be protected from liability for investment advice provided to participants by their 401(k) plan provider.

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